Lifestyle drives Atlantic seaboard and city bowl apartment sales to five-year high

THE DEMAND for a conveni e nt, c ompact and s e c ure lifestyle has resulted in apartment sales and prices reaching a five- year high across the Atlantic seaboard and city bowl suburbs, according to Seeff ’s managing director for the areas, Ian Slot.

“There is a substantial number of apartments in these suburbs and our sectional title agents say that demand is at a record high. Severe stock shortages are now prevalent almost across the board, but especially in high density areas such as Sea Point, Green Point, Mouille Point, the V&A Waterfront, the CBD and city bowl.

“Although the build-up in demand over the past three years has been gradual, there has been a flurry of buyers heading to the apartment market in the last year especially. Consequently, apartment sales for the 12 months ending in April for the combined Atlantic seaboard and central city areas surged to about 1 074, worth almost R2.9 billion. This is a significant 42 percent more than the 759 unit sales and 6 1 percent more t han t he R1.8bn of sales for the comparative period three years ago.

“The buoyant demand and activity have also resulted in a 13 percent increase in the aver- age price of apartments across the areas to R26 172/m² from around R23 197/m² three years ago. This significantly outpaces the market average of around 6 to 8 percent as provided by FNB and ABSA,” says Slot.

Also noteworthy is the drop i n t he average dif f e rence between the listed and selling price from around 10 percent three years ago to within a more positive 5 percent to 6 percent. Although still the exception rather than the rule, Slot says Seeff agents are reporting increasing numbers of buyers prepared to pay closer to the listed price and even more. Agents, Hilary Biccari and Bianca Gutteridge, for example, sold a two-bedroom Sea Point flat for R3 million against a listing price of R2.6m.

“Across the board, our agents report that they now have waiting lists of cash and bond- ready buyers. Most in demand are flats in the subR3m price band and luxury apartments up to around R6.5m,” say agents Adrian Mauerberger and Rosa Karp.

Sea Point’s Biccari and Gutteridge say they cannot keep up with demand.

“Almost as soon as we list a new apartment, it is sold. For sellers, this is an opportune time to put their properties on the market provided they are priced realistically,” they say.

Green Point, Mouille Point and Three Anchor Bay agents, JP Ricketts and Ayeh Khalatbari, echo the sentiment. These areas, in particular, have very little available stock. The picture is similar in the luxury apartment sector according to Mauerberger and Karp who say that Bantry Bay and beachfront apartments in Sea Point especially are most in demand when it comes to luxury buyers.

According to Jason Paans and Warren Emett, apartments in the CBD and surrounds are also popular.

“The fear of overstock that prevailed three to five years ago has long since been allayed. There i s demand f or f l ats priced below R1.6m that is seeing demand, and more expensive apartments are now also f i nding buyers. Seef f has recently sold 37 apartments worth almost R53m at an average price of over R1.4m.”

Apartment sales at the V&A Waterfront are also at a fiveyear high, according to agents Ross Levin and Kim Bailey.

In the last year, for example, about 35 apartments were sold there compared to just 21 three years ago. Seeff alone has sold nine apartments, including a three- bedroom apartment in Ellesmere for R11.3m, a threebedroom unit in Kylemore for R13.2m, and a luxury apartment in Palgrave for R23.94m.

Although financial downscaling remains a strong reason for apartment buying, Slot says another reason is a desire for the lifestyle in these areas. Apartment living tended to be a stepping stone for younger buyers and tenants or a retirement option for older buyers, he says.

“People are generally short of time, and apartment living allows them to access a pleasant lifestyle and top-class infrastructure and amenities practi- cally on the doorstep. Aside from the obvious cost saving advantages on maintenance and security, there is the added benefit of being within walking distance of all amenities and work for many, in addition to access to the MyCiti Bus transport infrastructure,” says Slot.

“For most buyers, these areas offer a trendy lifestyle in an area where they may not be able to afford a freehold house. The future of residential living is likely to continue to shift to apartment and compact housing driven by the desire for the lifestyle, growing population and shortage of land.”